"The courting approach is in tune with the times," Sundararaman. "A structured 'go to market' strategy reflects the changing market of digital buyers who have ready access to information online. The key is to help companies understand the environment in each market. To understand the different pain points and different political issues in respective markets across the region."
He confirmed that ICT investment was continuing to grow across the Asean region powered in part by the digital transformation drive. Which was a key enabler of economic development. The increased adoption of 3rd Platform technologies like cloud, mobility and analytics was also expected to spur ICT spending.
"This obviously presents a lot of opportunities for companies," said Sundararaman. "And the best way to enter these markets is through partnerships as part of an end to end process. The 'conversation' is changing from talking just to tech buyers to companies identifying challenges and opportunities through the right partnerships in new markets. This also reduces the variables."
"In addition, a vertical approach - such as focusing on the manufacturing sector in Myanmar - will be more effective," he said.
Six robust economies - in depth
Sundararaman discussed key findings from the IDC study (commissioned by MDEC as part of the GAIN initiative). Some of these are listed here:
The projected IT spending for each of the six countries is as follows:
· Cambodia: IT spending is expected to grow at a CAGR [compound annual growth rate] of 6.6 percent to achieve US$259.9 million by 2019, pre-dominantly on hardware spending, with an increase of IT services seen within the next 5 years. In terms of IT services, IDC expects that healthy spending for hardware and software deploy services as well as security services will help service market to strongly increase in coming years
· Indonesia: IT spending is expected to grow at a CAGR of 9.2 percent to achieve US$18.8 billion by 2019, pre-dominantly on hardware spending, with an uptick of IT services seen within the next 5 years. Meanwhile, the IT services market is anticipated to reach US$1.3 billion by the end of 2016
· Myanmar: Given the poor state of ICT infrastructure and access in the country, hardware sales currently represent the primary driver of IT spending through 2019. Hardware spending is forecasted to reach US$256.41 million by 2019, representing 12.49 percent CAGR. Meanwhile, software spending is expected to reach US$30.15 million by 2019, representing 11.54 percent CAGR. As for IT services, spending is projected to reach US$15.07 million by 2019, representing 10.42 percent CAGR
· Philippines: IT spending is expected to grow by 10 percent CAGR by 2019 and is skewed toward hardware, with more than 70 percent focused on devices such as smartphones and tablets.
· Thailand: IT spending is expected to grow at 3.7 percent CAGR (2014-2019) achieving US$13.6 billion by 2019, pre-dominantly on hardware spending with continued increasing in IT services. The IT services market is anticipated to reach US$4.01 billion by the end of 2019.
· Vietnam: Hardware spending is forecasted to reach US$5,932.11 billion by 2019, representing 4.5 percent CAGR, while software spending is projected to reach US$403.84 million by 2019, representing 10.98 percent CAGR. IT Services spending is anticipated to reach US$574.47 million by 2019, representing 12.64 percent CAGR
His advice to focus on key verticals was driven by the following findings:
In line with the ICT adoption trajectory trends, the Banking and Financial Services Institution (BSFI) as well as Communications and Media sectors top the list as key verticals looking to invest in all six countries, presenting the biggest opportunities for MSC exporters.
The public sector, especially Government, is also a hot vertical in all countries, with the exception of the Philippines.
Other top priority sectors across all six countries covered in the ASEAN ICT Market Landscape Study include Retail and Manufacturing.
Additionally, for Myanmar, the Hospitality sector has also been marked as a priority vertical, while in the Philippines increased spending is also expected from the Services, Logistics and Business Process Outsourcing sectors.
Fast moving local tech champions
"Don't underestimate brand equities," Sundararaman said." Do it right from the beginning with the vendor to partner approach rather than vendor to market."
When asked about immediate targets for GAIN, MDEC's Norhizam emphasised that the MDEC wanted to help build local tech champions and the vision was to have "success stories from all 150 shortlisted companies."
Responding to a query about the selection process, IDC's Sundararaman said IDC has been helping to identify potential partners in the target markets while MDEC's Norhizam said the current list of 150 MSC Malaysia status companies on GAIN had to meet certain criteria.
During the briefing, chief executive officers from three of the local' companies on the GAIN programme - Victor Phang of iTalent Management; Chuah Wan Pin of Infopro Solutions and Joshua Sew of Jocom MShopping - spoke of positively outcomes such as how the initiatives were helping them to cut down the time required to gain footholds in their chosen target markets. Also on stage, Handojo Sutjipto, president director of Anabatic Technology a partner company from Indonesia, outlined some of the gains made in Indonesia as well as what partner companies could gain from the programme.
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